Acknowledgements TRURO, NS. Managing Assest for Sustainable Communities - A CIP Training Series 4/18/2018. Prepared by Stantec Consulting 1

Transcription

1 April 17th 2018 TRURO, NS Acknowledgements This initiative is offered through the Municipal Asset Management Program, which is delivered by the Federation of Canadian Municipalities and funded by the Government of Canada. Prepared by Stantec Consulting 1

2 Introductions Presenter: Lourette Swanepoel, Stantec Consulting Who are you and your what s your level of understanding? Prepared by Stantec Consulting 2

3 Learning Objectives Describe what asset management is and why it is important. Understand the importance of planners, engineers, and financial staff in the AM process. Identify the components of an asset management system. Differentiate and describe the scope of an AM policy, AM strategy and AM Plan. Assess organizational readiness using the MAMP Readiness scale. Agenda TIME: ITEM: 9:30 9:40 Welcome 9:40 10:30 Context 10:30 10:50 Creating an AM Policy & Exercise 10:50 11:00 Break 11:00 11:30 Creating an AM Strategy & Exercise 11:30 12:00 Case Study 12:00 12:45 Lunch 12:45 13:20 Creating an AM Plan 13:20 13:30 Readiness Scale Exercise 13:30 13:40 Break 13:40 14:00 Local Journey Roundtables 14:00 14:20 Reflections 14:20 14:30 Funding & Wrap-up Prepared by Stantec Consulting 3

4 CONTEXT What are assets? Physical stuff needed to deliver services What How Service Delivered Physical Asset Shelter Houses Transportation Roads & transit Recreation Skating rinks, sport fields, parks Safety Firehalls, trucks, police station Clean water Treatment plant, distribution network Collect and dispose liquid waste Treatment plant, collection network Collect and dispose solid waste Landfill, recycling centre, trucks Manage stormwater Collection network, ditches, wetlands Manage air quality /GHG Trees Prepared by Stantec Consulting 4

5 What is asset management? The ongoing process by which we manage our communal assets to ensure sustainable service delivery. Think of your own home...cleaning the floors...servicing the furnace...replacing the roof AM Defined ISO 55000: A coordinated activity of an organization to realize value from assets. Realization of value will normally involve a balancing of costs, risks, opportunities and performance benefits. National Roundtable for Sustainable Infrastructure: Asset management is an integrated business approach involving planning, finance, engineering and operations to effectively manage existing and new infrastructure to maximize benefits, reduce risk and provide satisfactory levels of service to community users in a socially, environmentally and economically sustainable manner. International Infrastructure Management Manual: The combination of management, financial, economic, engineering and other practices applied to physical assets with the objective of providing the required level of service in the most cost effective manner. Prepared by Stantec Consulting 5

6 What's your #1 job as a local government employee? Sustainable Service Delivery = Asset Management Prepared by Stantec Consulting 6

7 The Challenge Almost 60% of Canada s core public infrastructure owned and maintained by local governments 35% Excellent Good Fair Poor Very Poor Fit for future Adequate Requires attention Significant deterioration Unfit for future 2016 CIRC Key Findings Prepared by Stantec Consulting 7

8 2016 CIRC Key Findings 2016 CIRC Key Findings Prepared by Stantec Consulting 8

9 Asset Lifecycle Asset Deterioration Prepared by Stantec Consulting 9

10 Asset Deterioration Asset Deterioration Prepared by Stantec Consulting 10

11 Double Whammy Assets vulnerable to climate change Dawson Creek, BC. Source: CTV News Boom-bust communities Seasonal communities Shrinking communities Prepared by Stantec Consulting 11

12 Upfront Cost vs Lifecycle Cost Focus on initial capital cost Failing to fully recover costs and fees Keeping taxes low 20% 80% Not enough money! No funding reserves! REPAIR / REHAB COSTS Stantec Consulting Reactive vs. Proactive Management Deferring costs until asset fails costs more...and has service implications! Stantec Consulting Prepared by Stantec Consulting 12

13 Asset rich cash poor! Choices... Denial strategies Defer cost Secure funding from others Consequences... Service disruptions Upset customers Asset failure Social & environmental consequences Sustainability... More Immediate & Personal Sustainable development is development that meets the needs of the present without compromising the ability of future generations to meet their own needs. Brundtland Commission Environmental Social? Economic Prepared by Stantec Consulting 13

14 Nevermind your grandchildren your quality of life is at stake! Who is Responsible? PLANNING Population projections & Land supply Development location and type ENGINEERING Provide infrastructure to service development Replace, operate and maintain infrastructure FINANCE $ for new capital costs $ for operations and maintenance Prepared by Stantec Consulting 14

15 Linear Silos PLANNING Population projections & Land supply Development location and type ENGINEERING Provide infrastructure to service development Replace, operate and maintain infrastructure Problem FINANCE $ for new capital costs $ for operations and maintenance Solution Linear Silos PLANNING Population projections & Land supply Development location and type Driver ENGINEERING Provide infrastructure to service development Replace, operate and maintain infrastructure Problem FINANCE $ for new capital costs $ for operations and maintenance Solution Prepared by Stantec Consulting 15

16 Partners of AM Planning Budget Addressing Underlying Drivers Denial strategies Defer cost Secure funding from others Confront strategies Increase taxes User fees Reduce service delivery (with engagement) Demand reduction (such as land use) Prepared by Stantec Consulting 16

17 Some Cost Drivers Location: Infill vs. edge vs. leapfrog Flats vs. hillside vs. floodplain Some Cost Drivers Proportionate share: Lot size, lot frontage Catchments / capacity Prepared by Stantec Consulting 17

18 Some Cost Drivers Timing / phasing Development standards 2-lane Road, natural drainage Add drainage Add sidewalks Add lights, trees... Widen to 4 lane $1,000/m $400/m $300/m $2,500/m $4,000/m Are you on the higher or lower end of the cost scale? Does your revenue cover your total cost? Prepared by Stantec Consulting 18

19 It s not new but its different AM then Technical exercise Engineering responsibility Buying an AM software program Departmental management silos Reactive management process Capital focus Narrow risk focus Technical levels of service AM now Strategic exercise Integrated responsibility planning, engineering, finance Any data (GIS, spreadsheets, field notes) Integrated asset management Proactive management process Life cycle focus Risk assessment process with climate vulnerability / risk Community engagement on service levels Benefits Sustainable service delivery Better decision-making and transparency Fiscal stability & less money over lifecycle Reduced risks Higher customer engagement and satisfaction Prepared by Stantec Consulting 19

20 Framework Example - ISO Framework Example - IIMM Prepared by Stantec Consulting 20

21 Framework Example - AMBC Framework FCM Not Just One Plan - Continuous Process Organizational Strategic Plan Organization Values, Prioritization Criteria and Risk Policy Asset Management Policy Asset Management Strategy Asset Management Objectives Asset Management Roadmap Asset Management Plans Asset Management System Prepared by Stantec Consulting 21

22 Scalable Sound too complicated for your community?...it does not have to be. Components for Today 1. AM Policy 2. AM Strategy 3. AM Plan 4. Institutional Readiness / Self Assessment Organization Values, Prioritization Criteria and Risk Policy Organizational Strategic Plan Asset Management Policy Asset Management Strategy Asset Management Objectives Asset Management Roadmap Asset Management System Asset Management Plans Prepared by Stantec Consulting 22

23 CREATING AN AM POLICY Asset Management Policy Formalize and signal corporate commitment Outlines the principles that guides AM across the organization Connection between community objectives and management of assets. Integration of AM within the organization. Key roles for managing the asset management policy Prepared by Stantec Consulting 23

24 Asset Management Policy Policies should call for... Maintain & manage infrastructure assets at defined levels. Monitor standards and service levels. Develop & maintain asset inventories of all assets. Use full life cycle costing principles in establishing replacement strategies. Plan financially for the appropriate level of maintenance. Stable long term funding to replace / renew /decommission. Refer to handout Incorporate AM in corporate plans. Report to citizens regularly. Define the roles and responsibilities for your community... Prepared by Stantec Consulting 24

25 BREAK CREATING AN AM STRATEGY Prepared by Stantec Consulting 25

26 Asset Management Strategy Link between the policy level of the organization and the day-to-day implementation. Outlines current asset management practices. Identifies the desired state of assets and the target levels of service. Identifies the critical risks to be managed. Asset Management Strategy Provides a guide to each department to effectively implement asset management. Identifies how other corporate plans are linked to asset management plans. Identifies how AM decision-making is integrated into the organization. Provides clarity on the roles and responsibilities of the asset management team. Identifies the approach to reviewing and updating the strategy. Prepared by Stantec Consulting 26

27 Refer to handout Review the examples provided and outline the TOC for your AM strategy... Prepared by Stantec Consulting 27

28 Financial Sustainability of Infrastructure CASE STUDY Undeveloped Lands Under Consideration Development Industry Pressures Prepared by Stantec Consulting 28

29 Council Objectives Mandate to Council s Infrastructure and Buildings Committee Evaluate financial impacts: Capital cost - includes buildings, major equipment, land acquisition, etc. O&M cost - includes labour, materials, contracts, etc. other associated costs Will current practices make the development financially sustainable? Scenario Assumptions Rockland south development only Area split 65% residential 30% infrastructure, commercial, SWM 5% parks Potential for 5,500 units Population growth due to this development = 15,000 Timelines: scenarios for development 20 years 275 units/year 30 years 185 units/year Doubles the population of urban area Prepared by Stantec Consulting 29

30 Cost Assumptions Development Charges 100% Capital Cost Recovery for Fire Protection Services and Engineered Services 90% Capital Cost Recovery for library, daycare, parks & recreation, transit, etc. Employees benefits = +25% to salaries Acquisition of lands for new buildings = 20% of construction costs of buildings Useful life of assets from PSAB report Revenue Assumptions Estimated average annual taxes Based on property values of similar units in the area Residential: $1350/unit/year Commercial: $700K to 1.4$mil /year (use $1mil/year in analysis) Lower Tier Municipality add to property taxes County and School Board taxes for total tax bill not included Prepared by Stantec Consulting 30

31 Additional Needs Additional infrastructure to operate, maintain, repair and eventually reconstruct roads, sidewalks, water pipes, sanitary sewers, storm sewers new street lights Expansion of fire stations (Rockland and Clarence Creek) Expansion/new space for City Hall offices New/expansion public works facilities (municipal garage, salt storage, water and wastewater treatment plants, landfill) Additional equipment: public works, fire trucks, vehicles, daycare Additional staff all departments: Firefighting, Public Works, Community services, Administration, Finance, By-Law enforcement, Planning and Construction Other additional requirements: Insurance, Library, Police, Public Transit Is there something missing from the list of needs you might add? How would you cost out your needs? Prepared by Stantec Consulting 31

32 Would you recommend development approval or what AM concerns do you have? Infrastructure deficit + differed maintenance Insufficient funding only visible after several years into the development Prepared by Stantec Consulting 32

33 Observations Current practice for growth is not sustainable. Optimistic growth scenario may not be realistic in the present economic context is there a need for the urban area expansion? Will D.C. charges collected be enough to cover $33mil needed for new capital D.C. study underway? There is no growth management plan/policy to ensure sustainability. Some development standards are not consistent or relevant Can development standards / service levels be lowered? Observations Increasing property taxes can pay for growth: 30-year scenario seems to create a lesser tax burden (2.5% increase/year vs. 3%/year for the 20-year scenario) Optimize infrastructure investments: Adopt and implement preventive maintenance procedures Create dedicated reserve funds Improve efficiency in City operations Prepared by Stantec Consulting 33

34 Discuss You just approved a new subdivision but knowing how concerned Council are about costs you made sure that the developer is paying for all the new on-site infrastructure needed AND he will be paying a contribution towards future capacity upgrades at the WWTP... Helping? OR NOT Helping? Onsite Costs Offsite Costs Capital Costs O&M Costs Replacement Costs REPAIR / REHAB COSTS Stantec Consulting Prepared by Stantec Consulting 34

35 Discuss Your eco-resort community is concerned about the environment and climate change so you are working on a bike sharing program that would allow residents and tourists the opportunity to get around town center without having to drive on the already congested Main Street. Helping? OR NOT Helping? Discuss Your community is shrinking and the four-lane Mainstreet is no longer used at full capacity. What can you do to address the asset management challenges for this stretch of road? Prepared by Stantec Consulting 35

36 The Missing Link Make the fiscal link during land use planning Growth management strategies Land use bylaws Neighborhood plans, etc. Environmenta l Social Economic Can we afford to build it, operate and maintain it? BC Municipal Affairs and Housing sustainable_development.htm Prepared by Stantec Consulting 36

37 Lunch Break CREATING AN AM PLAN Prepared by Stantec Consulting 37

38 Asset Management Plan Asset Management Plan for each asset type (buildings, water, roads, etc.) and/or Corporate Asset Management Plan that includes all of the assets Asset Management Plan Asset management plans identify: Assets owned and their condition and performance Gaps between the current and desired levels of service Practices, projects, and programs required to close the gap Risks to service delivery A timeline for implementation Current vs projected funding required Future improvements to the plan Prepared by Stantec Consulting 38

39 Tips for Drafting a Plan Start - Don t wait for perfect data Align approach and format between departments Keep it short & tell a story Utilize examples or templates National Asset Management Strategy NAMS.plus Quick Start Tools & Templates for Building and AM Program NAMSCanada Not-for-profit in Canada Subscription NAMSplus Suite of Templates Follows International Infrastructure Management Manual Aligns with ISO Prepared by Stantec Consulting 39

40 NAMSPLUS Templates Method 1 Asset Register Calculation: In 2029 ( ) projected renewal is $55,744 Prepared by Stantec Consulting 40

41 Outputs: What is revealed by a good asset plan? Activities Operations Maintenance Capital renewal Capital Upgrade/New Resources Financing and staffing Timelines Programs Projections based on current programs Are we able to communicate the consequences and choices? Prepared by Stantec Consulting 41

42 Asset Management Plan Current State PSAB Tangible Capital Assets What do we own? Where is it? What does it cost? What condition is it in? INVENTORY & CONDITION Very Good Good How can you assess condition / value? Municipal Natural Assets Initiative (MNAI.ca) Town of Gibsons Fair Poor Critical State of Our Assets Condition Example - City of Edmonton Estimated Service Life (ESL) Remaining Condition Grade % ESL Remaining Very Good % Good 60 79% Fair 40 59% Poor 20 40% Very Poor < 20% Very Good Fair Good Poor Critical Prepared by Stantec Consulting 42

43 Asset Management Plan Current State PSAB Tangible Capital Assets What do we own? Where is it? What does it cost? What condition is it in? INVENTORY & CONDITION LEVELS OF SERVICE Desired State What are public s expectations? What do regulators require? What do we need to do and when? Do we need more / less? Levels of Service Service delivered Physical Asset Shelter Houses Transportation Roads & transit Recreation Skating rinks, sport fields, parks Safety Frequency, Firehalls, trucks, police station Hours of Clean water operation, Treatment plant, distribution network Costs Collect and dispose Range of liquid waste Treatment plant, collection network Collect and dispose offering, solid waste Landfill, recycling centre, trucks Standards, etc. Manage stormwater Collection network, ditches, wetlands Manage air quality /GHG Trees Higher Level of Service = Increased Cost...YET we keep taxes and fees low Prepared by Stantec Consulting 43

44 Levels of Service Mandated Regulations, codes, standards Associated with funding requirement Community Objectives Link to the Community vision, for example: Economic development Social well being Environmental concerns Reference InfraGuide best practice Asset Management Plan Current State PSAB Tangible Capital Assets What do we own? Where is it? What does it cost? What condition is it in? INVENTORY & CONDITION LEVELS OF SERVICE Desired State What are public s expectations? What do regulators require? What do we need to do and when? Do we need more / less? STRATEGY Closing the Gap How much money do we need vs have? How do we prioritize? Can we lower LOS? Can we defer? Prepared by Stantec Consulting 44

45 Close the Gap How can we close the gap? The Gap Very Good Good Fair Desired State = High LOS Strategies to close the gap Current State $$ needed Poor low Critical Asset Management Plan Current State PSAB Tangible Capital Assets What do we own? Where is it? What does it cost? What condition is it in? INVENTORY & CONDITION LEVELS OF SERVICE Desired State What are public s expectations? What do regulators require? What do we need to do and when? Do we need more / less? Manage Risk Where are we vulnerable? What are possible consequences? RISK STRATEGY Closing the Gap How much money do we need vs have? How do we prioritize? Can we lower LOS? Can we defer? Prepared by Stantec Consulting 45

46 Risk Risk Management Process The ice caps are melting, Leonard. In the future, swimming won't be optional. Engineers Canada Infrastructure Climate Vulnerability - PIEVC Risk Risk = Probability of Asset Failure Risk Rating Matrix X Consequence of Asset Failure NOT doing x, consequences y, likelihood z! Prepared by Stantec Consulting 46

47 SELF-ASSESSMENT MAMP Readiness Scale Prepared by Stantec Consulting 47

48 5 Key AM Components Policy and Governance Putting in place policies and objectives Bringing policies to life through a strategy or framework Measuring and monitoring progress People and Leadership Setting up cross-functional groups with clear accountability Ensuring adequate resourcing and commitment Data and Information Planning and Decision-Making Contribution to AM Practice Using data to support effective AM planning and decisionmaking: Asset Data, Performance Data, Financial Data Documenting, standardizing how organization sets priorities Plans capital and O&M investment Decides on budgets Training and staff development Sharing knowledge internally Participating in external knowledge sharing Assess where you are and progress Prepared by Stantec Consulting 48

49 Complete Self Assessment (Break as you need) LOCAL JOURNEY ROUNDTABLES Prepared by Stantec Consulting 49

50 Share & identify 3 personal action items... REFLECTIONS Prepared by Stantec Consulting 50

51 Video Just 5 Ways AM & Planning Intersect 1. Environmental planning, ESAs, parks, tree protection = natural assets 2. Climate resilience = risk management 3. DCCs, amenity contributions = cost recovery / O&M liability 4. Community engagement = Customer expectations and awareness 5. Alternative Transportation, TDM, density, infill, subdivisions = impact demand for new infrastructure assets Prepared by Stantec Consulting 51

52 How does your pet project / responsibility relate to asset management objectives? WRAP-UP Prepared by Stantec Consulting 52

53 Secure Funding through MAMP Municipal governments and partners applying in partnership Lesser of 80% of Eligible Costs and $50,000 Features: Continuous intake Time from application to decision (max. 8 weeks) Wider distribution ( # of Recipients 550) Projects 12 months (including 1 month for reporting) Contract with one Lead Applicant (applicants can form partnerships and share resources). Secure Funding through MAMP Eligible activities include: AM Assessments (needs or risks) AM Plans, Policies, and Strategies Data collection and reporting AM Training and organizational development Knowledge transfer, development and sharing Broad approach to eligible activities to ensure inclusivity Go to Programs MAMP Prepared by Stantec Consulting 53

54 Local Resources Thank You! Submit Feedback Forms Please!! Daniel Potter: Prepared by Stantec Consulting 54